25 Cal. 404 | Cal. | 1864
This case involves the constitutionality of the Act of the Congress of the United States, passed on the 25th day of February, 1862, entitled “An Act to authorize the issue of United States notes and for the redemption or funding thereof, and for funding the floating debt of the United States,” so far as it provides and declares that the notes to be issued by virtue thereof shall be lawful money and a legal tender in the payment of all debts, public and private, within the United States, except duties on imports and interest on the bonds and notes of the United States. If the notes issued by the authority of this Act be lawful money and a legal tender in payment of private debts, then the judgment in this action must be affirmed, otherwise it must be reversed.
With a sense that the question to be considered is one of extraordinary interest, and of paramount public importance, we have given to the subject a thorough and careful examina
In order the better to appreciate what may follow, it is deemed appropriate to refer briefly to the character of the Government of the United States, as it existed under the Articles of the Confederation, if indeed that compact could be regarded as rising to the dignity of a Government, in the true sense of that term.
The Confederation seems to have been a league of friendship between the thirteen original States, entered into for their common defense, the security of their liberties, and for their mutual and general welfare; and by this league the States which were parties to it bound themselves to assist each other against all force offered to, or attacks made upon them, or any of them, on account of religion, sovereignty, trade, or any other pretense whatever. The style of the Confederacy was declared to be “ The United States of America,” and by the fifth of these Articles it was provided, that for the management of the interests of the United States, delegates should be annually appointed in such a manner as each State should direct, to meet in Congress. No State could be represented in Congress by less than two nor more than seven members, and in determining questions therein each State was entitled to a single vote.
To this Congress, composed of a single House of Delegates, and which was the only department of the Government, was granted a list of powers which, in appearance, placed the Confederation on an equal footing with the other civilized and enlightened nations of the world; but this was so in appearance only, for it was expressly declared by the sixth section of Article Nine that the United States, in Congress assembled, should never engage in war, nor grant letters of marque and reprisal in time of peace; nor enter into any treaty alliances; nor coin money; nor regulate the value thereof; nor ascertain the sums or expenses necessary for the defense or welfare of the United States; nor emit bills, nor borrow money on the credit of the United States; nor appropriate money; nor agree
This Confederation which, as time rolled on, was expiring from its inherent debility, was finally given over by its friends as impracticable and devoid of the faculties of a vital Government. But the necessity for a Government, composed by the union of the States, possessing the powers of a sovereign nation, was realized by the people. Without such a Government, it was known that the independence recently won could not be retained, and hence the people of the same United States, conscious from experience of the weakness and infirmities of the Confederation as a Government, did, in order to form a more perfect union than that which existed under the Articles of Confederation, and to establish justice, insure domestic tranquillity, provide for the common defense, promote the general welfare and secure the blessings of liberty to them
The manifest design of the. framers of the Constitution, and of the people of the States who adopted it, was to organize an efficient consolidated Government, possessing all the elements of power essential to a great nation, with capacity to perform all things necessary to accomplish and secure the ends enumerated in the preamble of the Constitution. -For this purpose and to these fends, the Government was made to consist of three departments—-the legislative, the executive, and judicial—and to the ’legislative department was committed certain powers,, among which are the following:
1. To lay and collect taxes, duties, imposts and excises; to pay the debts and provide for the common defense and general welfare of the United States.
2. To borrow money on the credit of the United States;
3. To regulate commerce with foreign nations, and among the several States and with the Indian tribes.
4. To coin money, regulate the value thereof, and of foreign coin, and to provide for the punishment of counterfeiting the securities and current coin of the United States.
5. To establish post offices and-post roads.
6. To declare war, grant letters of marque and reprisal.
7. To raise and support an army; to provide and maintain a navy.
8. To make rules for the government and regulation of -the land and naval forces.
‘9. To provide for calling forth the militia to execute the laws of the Union, suppress insurrections and repel invasions.
10. And to make all laws which shall be necessary and proper for carrying into execution the foregoing powers, and all powers vested by the Constitution in the Government of the United States or in any department or officer thereof.
Here is an array of powers which were granted, to be exer
Congress has power to raise and support armies; to provide •and maintain a navy; and to provide for calling forth the militia to execute the laws, suppress insurrections and repel invasions. But these things cannot be done merely by legislative enactments, to the effect that armies shall be raised and supported, that a navy shall be provided and maintained, or that the militia shall be called forth for the purposes designated. To accomplish these objects men and material are indispensable; and money, as a means and medium of exchange, is necessary to obtain the services of men, and the material requisite can only be provided by an expenditure of labor and money. That wars, invasions and insurrections of fearful and direful magnitude might arise was foreseen by the wise, men who framed the Constitution and by the people who adopted it, and ample powers were expressly granted to Congress to provide for every conceivable emergency requiring the exercise and exertion of governmental power and authority, for the maintenance and preservation of the United States as a sovereign and independent nation.
Though the Government of the United States is one of enumerated and limited powers, it is supreme within its sphere of action. The Constitution emanated from the people, who, in its adoption, declared and decreed that “This Constitution, and the laws of the United States which shall be made in pursuance thereof, and all treaties made or which shall be made under the authority of the United States, shall be the supreme law of the land, and the Judges in every State shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding.” (McCulloch v. Maryland, 4 Wheat. 405, 406.)
In McCulloch v. Maryland, 4 Wheat. 407, Mr. Chief Justice Marshall said: “ A Constitution, to contain an accurate detail of all the subdivisions of which its great powers will admit, and of all the means by which it may be carried into execution, would partake of the prolixity of a political code, and could scarcely be embraced by the human mind. It would probably never be understood by the public. Its nature, therefore, requires that only its great outlines should be marked, its important objects designated, and the minor ingredients which compose those objects be deduced from the nature of the objects themselves.”
In Martin v. Hunter, 1 Wheat. 326, Mr. Justice Story, in delivering the opinion of the Court, said: “ The Constitution unavoidably deals in general language. It did not suit the purposes of the people, in framing this great charter of our liberties, to provide for minute specifications of its powers, or to declare the means by which those powers should be carried into execution.”
In the thirty-first number of the Federalist Mr. Hamilton said, in reference to the clause of the Constitution conferring on Congress the authority to make all laws necessary and proper for carrying into execution the express powers granted, that it was only declaratory of a truth which would have resulted by necessary and unavoidable implication from the very act of establishing the Federal Government and vesting it with certain powers ; and in respect to the same clause Mr. Madison said: “ Had the Constitution been silent on this head there can be no doubt all the particular powers requisite as a
There can be no doubt that Congress has the power to make all laws which may be necessary and proper to the complete execution of the powers enumerate^, and to which wé have referred, because the Constitution itself has so declared; and the only question to be settled by the Courts is as to what laws are necessary and proper for the puipose; for it must be conceded that laws might be enacted upon the pretext that they were necessary and proper to cany into execution an enumerated power granted to Congress, which might be repugnant to the Constitution or in violation of common right, which the Courts would be bound to pronounce invalid; but “ it is not on slight implication or vague conjecture that the Legislature is to "be pronounced to have transcended its powers, and its acts to be considered as void.” (Fletcher v. Peck, 6 Cranch, 128.)
The question of the necessity and propriety of the Act of
“We- admit, as all must admit, that the powers of the Government are limited, and that its limits are not to be transcended. But we think- the sound construction of the Constitution must allow the National Legislature that discretion with respect to the means by which the powers it confers are to be carried into execution which will enable that body to perform the high duties assigned to it in .the manner most beneficial to the people. Let the end be legitimate, let it be-, within the scope of the Constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consistent with the letter and spirit of the Constitution, are constitutional.”- (See also Gibbons v. Ogden, 9 Wheat. 187, and Ogden v. Saunders, 12 Wheat. 332.)
That the necessity for raising, equipping and supporting large armies, and for providing and maintaining a navy of
In United States v. Fisher, 2 Cranch, 396, Mr. Chief Justice •Marshall, in reference to the clause of the Constitution under consideration, said: “ In construing this clause it would be incorrect, and would produce endless difficulties, if the opinion should be maintained that no law was authorized which was not indispensably necessary to give effect to a specific power. Where various systems might be adopted for that purpose, it might be said with respect to each that it was not necessary, . because the end might be attained by other means. Congress .must possess the choice of means, and must be empowered to use any means which are in fact conducive to the exercise of a power -granted by the Constitution.”
Thus it appears, upon authority which commands our highest respect, that to Congress pertains the choice of means to carry into effect a power granted in express terms, though it. must be admitted that in the adoption of means for the purpose there must be a relation, in the nature and fitness of things, between the means used and the end to be accomjalished.
The power to declare war, to raise and support armies and a navy, to suppress insurrections and repel invasions, is, as already appears, expressly granted to Congress by the Constitution ; and the power to pass laws for carrying these express
Congress having passed the Act in question, as a means to carry into effect the power to raise and maintain an army and a navy to suppress the existing insurrection and rebellion, it .devolves on those who object that the means selected are repugnant to the Constitution to point out and show wherein is the repugnancy. If the Constitution contains no provision operating in restraint of the emission of treasury notes, and making the same lawful money and a legal tender in the payment of debts, in order .to make them the more efficient for the end to be attained, then upon what principle would a Court be authorized to proceed to the conclusion that the law is unconstitutional and void, in so far as these notes are made lawful money and a legal tender in the payment of debts ?
The objection interposed to the binding obligation of the tender clause of the Act is sought to be maintained on the ground that the power to make treasury notes or bills of credit a tender for the payment of private debts is not conferred on Congress by the Constitution, either expressly or by implication.
It must.be admitted that this power is not granted in express terms. If it exists, it is to be found in that- vast mass of incidental powers involved in the Constitution, which are to be exercised by Congress when necessary and proper to carry into effect powers expressly granted. But though the .Act in question be one depending for its constitutional warrant in the exercise of authority which is subordinate and ancillary to a principal and specific power, it may be equally valid as a law enacted to accomplish, in the most palpable and direct mode, an object specifically designated by the clearest constitutional expression. The Act is one relating to the means which Congress may adopt to attain an end; and the whole controversy is narrowed down to the constitution
. -The. able argument' of- the . appellant’s: counsel against the policy of the legislation. of Congress making these treasury notes a legal tender - in the. -payment - of private debts, which •he has .enforced by an array of. examples which should cause legislators to pause in their deliberations, -would have been •particularly appropriate .could -it have been addressed to Congress before passing. the Act in question; but -the evils portrayed as the consequence of making anything besides gold and silver .a, medium of exchange and a tender in the payment of debts .would not alone authorize, this-. Court to pronounce against the law. .As..an argument ab inconvenienti, it would have its just weight in the-determination .as to the validity of a law of doubtful authority, and this-is the use to which, we apprehend, the learned counsel intended it should be applied.
The Constitution does not deny to Congress the authority to emit bills .'on the- credit .of the United States, nor is this power expressly conferred. If it can be exercised it must be in subordination to some specific power, when necessary and proper for carrying such power into. execution. That the framers of the Constitution intended -to leave the subject in the condition in which it is left, we think is manifest from -the debates-that transpired in the Convention in respect to it. From these debates it appears that-the subject was considered and that the Convention refused to confer on Congress the power in express language to emit bills of credit. From this it seems apparent that the framers of the Constitution and the people who adopted it intended that this power should not be granted to Congress as a principal power; and as the authority was not' .inhibited, we think it follows that it was intended Congress might exercise the power as ancillary to the powers ■ expressly "granted, when in its wisdom it should
Mr. Calhoun, in his speech on the bill to establish a national bank, delivered in the House of Representatives in February, 1816, argued that, taking into view the prohibition against the States issuing bills of credit, there was a strong presumption that this power was intended to be given exclusively to Congress (Calhoun’s Works, 2 Yol. 155, 156.) It is certain that from a very early period in the history of the Government the power to issue bills of credit, or, in other-words, notes on the credit of the United States, has been exercised; and if legislative exposition, acquiesced in and maintained by the Courts, is ever of paramount force, it would seem that the power of Congress over this question must be considered as settled.
The next question that occurs in the discussion, after having arrived at the conclusion that Congress has the power, under circumstances of necessity, to issue treasury notes or bills of credit, is as to the power of Congress to make such notes or bills lawful money, or the equivalent of lawful money, and a legal tender in the payment of private debts.
What constitutes money, and its use as a measure of values, has ever been, among political economists, an important element in the consideration of subjects relating to material wealth. Money, in its enlarged sense, is that general medium of exchange by reference to which the value of other things is estimated, and is the representative and equivalent of such value. Those who desire, may learn from history that since society had its first existence many different commodities have been used as a circulating medium or medium of exchange. Some of these were most inconvenient and ill adapted to the purposes of exchange, but seem to have been adopted for want of something better. The precious, as well as the base metals,, were used' in some countries at an early date, though in others; at a comparatively modern period, other substances were employed as the currency, by which exchanges were effected.
In all ages of the world, and in nearly all countries, metals seem to have been used, as if by common consent, to serve' the purposes of money; other articles have been and still are used as money, such as paper in highly civilized countries, and cowrie shells and like articles of insignificant intrinsic value among barbarous nations. Metals, in all times of which we have any historical knowledge, were esteemed of value for practical uses, and were employed in commerce, probably not so much as a general standard of the value of other things as an article which facilitated exchange by barter. In the earliest annals of commerce metals are spoken of as objects of value; and it may safely be assumed that metallic money was selected as a medium of exchange because its value was less fluctuating than that of most other substances. Especially, says Mr. Mill, was gold and silver fixed upon by the tacit concurrence of almost all nations to serve this purpose, for the reason that no other substances unite the necessary qualities in so great a degree with so many subordinate advantages. The contrivance of fabricating gold and silver into coins, by which the weight and value of each coin was ascertained and indicated by its face, is of remote antiquity. And in order to secure the advantages of uniformity and public confidence in the currency, G-overnments in modern times have usually exercised the exclusive right to coin money and regulate its value. By the
Gold and silver fashioned into coins are not exempt from the laws which govern the prices of other commodities, though generally they have been less subject to fluctuations in value than almost any other articles of production, for the reason that their production has not, except perhaps in two instances of modern times, exceeded their ordinary demand. The instances referred to stand connected with the discovery of the mines of Spanish America, in the sixteenth century, and the more recent and transpiring discoveries of the precious metals in Australia and upon the Pacific slope of the United States of America. In the course of a century and a half immediately following the discovery of the Spanish American mines, the depression in the value of gold and silver was as three to one; and we who live at this day have not failed to observe the great and permanent increase in the price of commodities within the last fifteen years, consequent upon the increased production within this time of the precious metals; so that, though moulded into coins and impressed with the stamp of the mint, they retain all their properties as articles of commerce, and are a measure of the value of other things in the same manner as the latter are a measure of the value of gold and silver.
Mr. Mill says: 61 The relations of commodities to one another remain unaltered by money; the only new relation introduced is their relation to money itself; how much or how little money they will exchange for—in other words, how the exchange value of money is determined. And this is a question not of any difficulty, when the illusion is dispelled which caused money to be looked upon as a peculiar thing not governed by the same law as other things. Money is a commodity, and its value is to be determined with that of other
Professor Colton, in treating of the subject of paper money, and banking, says that gold and silver, used as money are a mere credit currency, representing all the values arising from the great variety of their uses, and their credit is based upon these values, them value as money being but a fraction of the whole, itself borrowed from these other values. (Public Economy, Ch. 16.)
Both gold and silver, as to their value, are alike subject to the laws of change consequent upon the extent of their demand and production, and are therefore imperfect standards of value. Affected by the same law or principle, each of these metals is subject to change in its own value, and in relation to the value of the other, and also to that of other commodities ; and hence it is that the inequalities in the relations of value between these two metals have been sought to be adjusted by Governments, as the exigencies of change required, by altering the quality or weight of the coin without changing its denomination.
In the time of and prior to the reign of Henry III of England, silver was the universal medium of exchange in that country, and it was not until the time of Edward III that gold, as well as silver money, became a legal tender; and from that period until the year 1774, both these kinds of money were recognized by law as authorized standards of value, in all payments whatever, when it was provided by statute (14 George III, c. 42) that thereafter silver coins should not be a legal tender in payment of any sum exceeding twenty-five pounds, except according to their value in weight, at a specified valuation per ounce. In 1816 the legal tender of silver-coins was still further restricted to payments not exceeding forty shillings. (1 Blackstone Com. 277.)
A writer, whose name we have been unable to learn, in an able article on the subject of money, argues that, as a matter of convenience, “ the metal of which the chief medium of exchange is fabricated should have reference to the wealth and
Mr. Ricardo, in his work on political economy, at page 507, expresses the opinion that money, in its most perfect state, is paper money; and Adam Smith said: “ The substitution of paper in the room of gold and silver money replaces a very expensive instrument of commerce with one much less costly and sometimes equally convenient.” (Wealth of Nations, Vol. 1, page 447.) Professor Colton argues that money, in all its forms and substances, is a credit currency, and derives its credit from considerations extraneous to itself; and that the invention of paper money was, in the march of civilization, as much an improvement on metallic currency, in its adaptation to the necessities of the commercial world, as metallic money was an improvement on the system of barter.
Thus much has been said respecting metallic and paper money for the purpose of furnishing a general idea of the causes which induced and necessitated the use of these substances as a medium for effecting exchanges, and particularly with the object of dispelling the illusion which, having become inveterate from misleading associations, has caused the precious metals
Money is, as we have before observed, in a general and enlarged sense, a medium of exchange, by which the value of other things is estimated, and is the representative and equivalent of such value, and in the sense of the term as thus defined we must understand the words “lawful money,” as used in the Act of Congress under consideration.
The principal objection on the part of the appellant is that Congress had not the power under the Constitution to make the notes issued in pursuance of the provisions of the Act in question a legal tender in the payment of private debts. If Congress has the power to make gold and silver coined at the Mint a legal tender in the payment of debts, upon what argument can the objection to the making of treasury notes issued on the credit of the United States a like tender, be maintained? It may, perhaps, be answered that the power to coin money is granted, and that coining money means the fabricating of metals into coins, and that therefore nothing except coined metals can be made a legal tender in the discharge of pecuniary obligations. Were it admitted that the power “ to coin money ” is limited to a coinage of metals, it would not result from this that no other kind of money could be made a legal tender, unless it were first conceded that Congress had no power to adopt means for the execution of a designated power except the means were specified. Such a concession, however, has never been made by the judiciary, nor by any enlightened statesman, however narrow have been his views of constitutional power. We do not maintain, nor do we believe, that Congress possesses any powers not granted in the Constitution, but it cannot be conceded that no powers are granted except those expressed in terms. The powers to levy and collect taxes, to pay the debts and provide for the common defense and welfare of the United States, to borrow money, to regulate commerce, to coin money, to establish post offices and post roads, to raise and support an army and to provide and maintain
The truth that the United States of America was constituted by the people a consolidated Government, sovereign and supreme within the scope of the powers specified, should ever be kept in view when estimating the measure of its capacity and power. In Cohens v. Virginia, 6 Wheat. 414, Chief Justice Marshall said: “America has chosen to be, in many respects and to many purposes, a nation; and for all these purposes her Government is complete; to all these objects it is competent. The people have declared that in the exercise of all powers given for these objects, it is supreme. It can, then, in effecting these objects, legitimately control all individuals or Governments within the American territory.” In the same case this venerated Judge, who never failed, when the occasion for an opinion demanded a construction of the powers of the Government as a nation, to show how utterly fallacious and destructive of nationality was the doctrine of a narrow and illiberal construction of the 'Constitution, said: “A Constitution is framed for ages to come, and is designed to approach immortality as near as mortality can approach it. Its course cannot always be tranquil; it is exposed to storms and tempests, and its framers must be unwise statesmen indeed if they have not provided it, as far as its nature will permit, with the means of self-preservation from the perils it is sure to encounter.” (6 Wheat. 387.) And in the course of his exhaustive argument in the same case he further said: “ We think that in a Government acknowledged supreme, with respect to objects of vital interest to the nation, there is nothing inconsistent with sound reason, nothing incompatible with the nature of Government, in making all its departments supreme in so far as is necessary to their attainment.” (Id. 415.) “ The sword and the purse,” he said in McCulloch v.
To declare war and to suppress insurrections and repel invasions are sovereign powers in a Government, necessary for its defense, perpetuity and the general welfare. It must be intended that those who organized the Government of the United States were well aware that the republic, which had its origin in- their day, would be exposed to perils from without and also to dangers from within, and hence the power was granted to declare war as the exigencies for war might arise; as also the power to repel invasions, to suppress insurrections and to punish treason, that thereby the general welfare might be promoted, and the blessings of liberty secured for themselves and their posterity, who, through succeeding generations, should possess the land for ages to come.
The power to declare war, suppress insurrections and repel invasions is paramount among the specifically enumerated powers granted to Congress, to which all other express powers stand in auxiliary relation. Among these is the power to raise and support an army, and to provide and maintain a navy; and directly to this end every able-bodied citizen may be compelled, as exigencies require, by pains and penalties involving his liberty and life, to leave the peaceful avocations of his home to meet in arms the enemies of his country; and to the same end all material and munitions necessary to the successful prosecution of war may be appropriated if need be. Fortifications may be constructed, and ships for the navy may be built and equipped, at the cost of labor and money; and to accomplish these and like objects, all of which are auxiliary
Without the power to defend against invasions and to suppress insurrections and rebellions, our Government would rise to a degree of importance no greater than a “ splendid bauble.” But happily for the people who organized it and their posterity, its powers were and are sufficiently comprehensive to constitute the union of the States a consolidated Government and a sovereign within the scope and measure of the powers granted, which powers not only comprehend those specified in terns, but also all incidental powers, necessary and proper for carrying into execution the powers particularized. (Story on Const. sections 430-435.)
As we view the question, it is not necessary to seek for the power to make the treasury notes issued under the Act of Congress of the 25th of February, 1862, a legal tender in the payment of debts alone among the powers to borrow money, to regulate commerce and to coin money, though we do not say it may not be deduced from some one of these; but we think it appropriately belongs to the power which Congress has over the subject as a means, ancillary to the accomplishment of the legitimate object for which they were really issued, and that the Act of Congress upon this particular point was an exercise of sovereign authority within the scope of the powers granted in the Constitution.
The general conclusion to which we have been conducted has been reached by the Court of Appeals of New York, in
This law having emanated from the sovereign authority, by which the notes issued in pursuance of its provisions are made lawful money and a legal tender in the payment of debts, is the supreme law of the land, and is with us the rule of judgment.
Therefore the judgment must be and is hereby affirmed.